Title - Railways seeks legal view on setting up tariff authority

New Delhi : In a bid to ensure that there would be no legal tangles with regard to creating a tariff authority which would periodically review the conditions under which the Indian Railways works and whether there was a need to alter the fares and freight, the government has sought legal view for setting up the Rail Tariff Authority (RTA).Reports said the Railway Ministry has written to the Law Ministry seeking its views on the setting up of the authority through an executive order without taking the due course of legislation.The government wants to know whether the methodology adopted would stand constitutionally. Besides, the proposal, given an in-principle clearance by the Union Cabinet, has a clause that the government must seek a legal view from the Ministry of Law before setting up the tariff authority.The Railway Ministry wants to be sure that setting up such an authority would stand in the court of law and is constitutionally sound.Further move on the setting up of the authority would only be made after a clearance is received from the Law Ministry.The Rail Tariff authority would be a five-member body. The four members would be employees of the Central Government and the chairman cannot be from the central government unless he has served at the Secretary level.The selection committee for the Rail Tariff Authority would consist of Cabinet Secretary, Chairman, Railway Board, Finance Secretary and one expert by Railways.Setting up of the tariff authority became essential for the government due to the falling financial health of the Indian Railways in the wake of successive Railway Ministers toeing the populist agenda refrained from raising the passenger fare even though the 'full coffers' of the public sector organisation continued to bleed.

For almost a decade, the successive Railway Ministers did not raise the passenger fares leading to a skewed operating ratio for the railways.

The main job of the RTA would be to frame tariffs considering the Central Government projection of plan and non-plan requirement of funds.